DealBook cites a Reuters article pointing out that credit sentiment and rate increases could have a deleterious effect on what Reuters calls "fast growing private equity funds." (I think they mean buyout funds, but I suppose they could just mean buyouts and mezz). Most of the article will strike Going Private's regular readers as a "tell me something don't already know" sort of thing, but one line caught my attention:
Jon Moulton, managing partner of Alchemy Partners, a UK-based private equity advisory firm, said the market could prove fragile because of the multiple layers of debt used in a modern private equity buyout, the huge growth in non-bank participants in the loan market and a lack of proper covenants attached to loans.
"Non-bank participants." Sounds like hedge funds to me, but then maybe I just haven't had enough Kool Aid.